Poms & Associates' Insurance Facility Addresses New UNFI Limits

LOS ANGELESWith the latest enforcement on higher liability insurance requirements  from UNFI Inc., Poms & Associates Insurance Brokers created a facility to further aid companies with these new limits.

The requirements  for suppliers have been increasing as UNFI joins other large chains such as Walgreens, Whole Foods Markets and NBTY in enforcing these insurance limits more. Greg Doherty, dietary supplement practice leader of Poms &  Associates Insurance Brokers, expressed that these requirements  will affect the insurance costs of dietary supplement suppliers significantly.

"They did this sometime last year but it is now just hitting the radar screens of UNFI suppliers, many of which currently have a standard $2-million limit of insurance," said Doherty. "And the new requirements are quite unusual:  $3-million per occurrence and $5-million aggregate.  Normally, the occurrence and aggregate limits match.  Some companies are going to find it difficult to match the new requirements, so as to provide what UNFI wantsno more, no less."

The insurance facility aims to take in companies up to the required $3-million per occurrence/$5-million aggregate. There will be clarity for the insurer to be aware that the insurance is purchased not as a perceived increased in the risk, but to satisfy UNFI.

 "Most of the big box chains, and GNC and Vitamin Shoppe, have an insurance requirement of $5 million," he added. "Now, some of the large distributors and manufacturers of dietary supplements are asking their suppliers to match the insurance limits that their customers demand of them. I see this trend continuing."